Interim GM CEO to stay at helm

Tuesday

Jan 26, 2010 at 2:00 AM

Ed Whitacre says he'll remain at General Motors at the request of the auto company's board.

Bloomberg News

DETROIT — General Motors Chairman and Chief Executive Officer Ed Whitacre, who planned to hold the CEO title only while he searched for a successor, said yesterday that he will keep the job permanently at the request of the board.

Directors made decision at a special meeting last week, Whitacre told reporters yesterday in Detroit. After discussing the idea for a while, the board acted to give GM clear leadership, said two people familiar with the matter who asked not to be identified because the discussions weren't public.

Staying at the helm means Whitacre, 68, will oversee the restructuring that began before he became chairman as GM exited bankruptcy on July 10. The former AT&T chairman and CEO took the chief executive's role at Detroit-based GM on Dec. 1 when the board asked Fritz Henderson to step aside.

"This place needs some stability, and I guess that's me," Whitacre said, adding that he's "pretty well set on the top leadership team."

He told employees on Dec. 2 he expected the search might take a year, then put his stamp on management by reshuffling senior executives and recruiting a new finance chief.

Whitacre, 68, hired Chief Financial Officer Chris Liddell last month from Microsoft, where he had been CFO. He also named new leaders for North American and European operations and brought two executives he worked with at AT&T to run GM's lobbying activities. Whitacre reiterated yesterday that U.S. and Canadian government loans will be repaid by June.

"This move tells the troops that Whitacre is the boss and everybody should put on their helmets and march forward," said Joe Phillippi, president of AutoTrends Consulting in Short Hills, N.J. "The question is how long will Ed stay around? Liddell is obviously a candidate for the CEO job."

Whitacre said he'll remain "an adequate amount of time," perhaps two or three years.

"I certainly didn't come into this with that intention" of becoming permanent CEO, Whitacre said. "You sort of get pulled in. I didn't know this was going to happen to me. In fact, I planned for it not to happen."

Whitacre retired as AT&T's chairman and CEO in May 2007 after leading the biggest U.S. phone company since 1990. He spent 43 years at AT&T and its predecessor companies.

The Treasury's auto task force named Whitacre in June to lead the revamped board that took over when GM exited bankruptcy. His associates had speculated when he first took the CEO job last month that he might keep the role.

GM had hired Chicago-based Spencer Stuart, the largest closely held executive-search firm, to look for a new CEO, a person familiar with the matter had said last month. Whitacre said the search had gone on for a "pretty good while" before being called off.

Last year's restructuring gives Whitacre an advantage against Ford, which is led by CEO Alan Mulally, said Erich Merkle, president of Autoconomy, an advisory firm based in Grand Rapids, Mich.

"The new CEO at GM will have an easier job than Mulally, given what the bankruptcy and government rescue has done to trim dealers, close plants and fix the balance sheet," Merkle said.